Preheat the oven to 180°C.
Place the flour, sugar, butter, eggs and vanilla extract in a large mixing bowl and beat using an electric hand-held whisk until smooth; usually 2-3 minutes. Line 2 x 12 hole cupcake tins with cupcake cases and bake spoon the batter evenly into them. Bake for 18-22 minutes until golden, risen and springy to the touch.
Remove and allow to cool on a wire rack.
Meanwhile, divide the icing sugar between as many bowls as you have colours of food colouring. Add drops of the food colouring to each bowl and mix to a smooth icing paste using a little boiling water, making sure you don't add too much water. When the cupcakes are cool, level off any that are uneven on top using a sharp knife.
Spread the coloured icings evenly on top then decorate with the fondant decorations. Leave to set on a wire rack before serving.