Dissolve the yeast in milk with 1 teaspoon sugar until smooth. Mix the flour with remaining sugar and salt.
Add the cinnamon, egg, butter and yeast milk into the flour, and knead to a smooth dough.
Cover the dough and let rise in a warm place for 30 minutes.
Heat the frying oil in a large pot or deep fryer to 180°C (fan: 160°C, gas mark 2-3) (approximately 350°F) (the oil is hot enough when a wooden spoon is inserted in the hot oil and bubbles start rising over it).
Divide the dough into 12 equal-sized balls form and let stand briefly. Drill each ball in the center with floured fingers on a floured work surface and extend the ball in a circular motion so that a ring-shaped donut is formed. Press the donuts flat and fry in hot oil for 2 minutes on each side. Lift out the donuts and drain on absorbent paper.
Serve the donuts dusted with powdered sugar.