Preheat oven to 350°F. Line 12 muffin tin with paper liners and set aside.
In a large bowl whisk together flour, baking powder, baking soda, and salt. Set aside.
In the bowl of stand mixer, cream butter and brown sugar until smooth. Add egg yolks and vanilla extract. Mix on medium speed until lighter in color and thoroughly mixed.
Add half of flour mixture, then half of coconut milk. Repeat and mix until just combined. Add 1 cup of toasted coconut and fold to combine.
Using a hand mixer, whisk egg whites to soft-medium peaks. Add half of egg whites to batter. Fold to combine. Add remaining half and fold until combined. Do not overmix.
Divide the batter between prepared muffin tin. Bake for 18-20 minutes until toothpick inserted in center of cupcake comes out clean. Remove from muffin tin and allow to cool to room temperature on wire racks. Allow cupcakes to cool to room temperature before frosting.