In a medium bowl, whisk together the flour, baking powder, and salt.

In a large mixing bowl or stand mixer, beat the sugar and butter on medium speed until light and fluffy, about 3 minutes. Add the vanilla and mix well.

Add the eggs, one at a time, beating well after each addition and scraping down the bowl as needed.

With the mixer on low speed, alternate adding the flour mixture and coconut milk, beginning and ending with the flour mixture. Scrape down the bowl as needed, then stir in the shredded coconut.

Spoon the batter into the cupcake liners, filling each about three-quarters full.

Bake for 20-23 minutes or until a toothpick inserted into the center comes out clean. Let the cupcakes cool in the pan for a few minutes before transferring to a wire rack to cool completely.

In a large bowl or stand mixer, beat the butter and cream cheese on medium speed until smooth.

Slowly add the powdered sugar, beating on low until combined, then increase to medium speed. Add the vanilla and coconut milk, and beat until fluffy, about 1 minute.

Transfer the frosting to a piping bag fitted with a decorative tip, then pipe the frosting onto the cooled cupcakes.

Sprinkle the tops of each cupcake with shredded coconut.