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Preheat oven to 160°C and prepare a round cake pan by lining it with parchment paper. Wrap the outside of the pan with foil to protect it during the water bath.
In a heatproof bowl set over simmering water, melt cream cheese, butter, and milk together until smooth. Remove from heat and allow to cool slightly.
Whisk egg yolks and vanilla into the cream cheese mixture until fully combined.
Sift in flour and cornstarch and mix gently until smooth and lump-free.
In a clean bowl, beat egg whites with cream of tartar until foamy. Gradually add sugar and beat until stiff peaks form.
Fold one third of the egg whites into the batter to loosen it, then gently fold in the remaining whites in two additions.
Pour the batter into the prepared pan and place it into a larger baking tray. Fill the tray with hot water halfway up the sides of the cake pan.
Bake for 50 minutes until set but slightly jiggly in the center.
Turn off the oven and leave the cake inside with the door closed for 10 minutes. Remove and cool completely before chilling.
Refrigerate for at least 2 hours before serving. Dust with powdered sugar before slicing.