Beat the butter (either by hand, using an electric mixer or stand mixer) until pale, light and fluffy. This could take several minutes.
Sieve half of the powdered icing sugar into the butter and beat until combined, then repeat this with the remaining half of powdered icing sugar.
Add in the caramel and salt (if using), mixing until only just smooth. Use to frost your cupcakes, cakes, brownies, etc. and enjoy!
Notes
It's best to use the thick store-bought caramel sauce. This usually comes in a tin or jar like the Carnation brand caramel. The squeezy kind will give you a thinner frosting.