Preheat oven to 425°F (218°C). Spray 12-count muffin pan with cooking spray and set aside.

Using a handheld or stand mixer fitted with a paddle attachment, cream butter and sugar together on medium speed. Mix in the egg, vanilla extract, and milk. Gently stir in flour, baking powder, cinnamon, nutmeg, and salt. Do not over-mix – stir until combined.

Spoon 1 heaping Tablespoon of batter into muffin cup. Layer with 1 heaping teaspoon Nutella in the center and spoon another heaping Tablespoon of batter on top. If the muffin tins are completely full, that’s ok. Repeat layering batter and Nutella into each muffin cup. (Recipe makes about 8-9 muffins.) Fill the empty muffin cups halfway with water to help prevent pan from warping. (Optional, but it doesn’t hurt.)

Bake at 425°F (218°C) for 5 minutes. Keeping the muffins in the oven, reduce temperature to 350°F (177°C) and bake for an additional 13-17 minutes until batter is set. Cool muffins in the pan for about 5 minutes.

While the muffins are cooling, make the cinnamon-sugar topping. Melt the butter in the microwave. In a separate small bowl, stir the sugar and cinnamon together. Dip the top of each muffin into the melted butter, then dip into the cinnamon-sugar mixture. Swirl them around in the cinnamon-sugar a bit to make sure you get a thick coating. Set upright on cooling rack.

Muffins stay fresh in an airtight container up to 1 week.