Preheat oven to 325F/160C. Place 8 6 oz/17 7ml custard cups in a large roasting pan. Set aside.
To make the caramel, place the sugar and water in a small heavy saucepan. Heat over medium-high heat, swirling pan to dissolve the sugar. The liquid will appear clear when the sugar is dissolved. It is very important that you do NOT stir this so resist the temptation. Once the syrup begins to boil, place a lid on the pan. This will cause condensation that will "wash" the sides of the pan and prevent the sugar crystalizing. Remove the cover after a minute or 2, then let it boil until it's a dark amber syrup.
Divide the caramel evenly in each custard cup. Rotate each cup so the syrup coats up the sides. Keep doing this with each cup until the syrup no longer moves.
To make the custard--Combine the milk, cream, sugar and salt in a large saucepan. Bring to a simmer over medium-high heat, stirring occasionally and making sure sugar is dissolved. Remove the pan from the heat.
Whisk the whole eggs, egg yolks and vanilla in a large bowl. Gradually add the hot milk mixture whilst whisking. Do this slowly or else you'll scramble the eggs. Strain the mixture through a strainer so there are no bits of egg (there will be) in the custard.
Distribute the custard mixture evenly between the custard cups.
Now boil a kettle of water and pour the water in the baking dish around the custard cups--be careful not to get any water in the custard cups. NOTE--this is easier if you put the roasting pan with the custard cups in the oven first then carefully pour the water in.
Bake for 30-35 minutes or until the edges are set but the middle still has a little wiggle in it.
Remove the custard cups to a rack to cool completely. Cover with plastic wrap and place in the refrigerator for at least 12 hours or up to 3 days.
To unmold, run a small knife around the the edge of each custard cup to loosen the custard, then invert onto a serving place. Shake the cup a little if it doesn't release.