Preheat oven . Preheat the oven to 180°C (350°F) and line a baking tray with parchment paper.
Release oils from the lemon zest. In a large mixing bowl, add the sugar and lemon zest and using your fingertips, rub the two together for 1 minute.
Add dry and then wet ingredients and mix. Into the bowl with the sugar, sift in the dry ingredients; flour, baking powder and salt and mix together briefly.Make a well in the centre then add the wet ingredients; eggs, butter, fresh lemon juice (or limoncello) and vanilla extract. Using a wooden spoon, work from the middle out to mix the ingredients until just combined. Then gently knead the dough a couple of times until it comes together. The mixture will feel a little sticky and if you prefer you can refrigerate it at this point for 30-45 minutes to make it easier to handle when shaping. Shape dough. Lightly dust a work surface and your hands with flour. Divide the dough into two, and using your floured hands, gently knead each portion of dough a couple of times until it comes together and is smooth. Then roll each piece into the shape of a log.Place each log onto a baking tray and continue to shape the two halves into a roughly 30cm long x 5cm wide (12-in x 2–in) long log. Leave space between the logs, as the dough will spread while baking. Use moistened hands to flatten the tops and smooth the dough. Option: Egg wash and sprinkle with sugar. You can egg wash and sprinkle over sugar for crunch if you like. I haven't in today's recipe, but occasionally I will if I have a leftover egg from another recipe! Make an egg wash by whisking together the remaining egg and milk in a small bowl. Brush the egg wash over the logs, and then sprinkle them with the extra teaspoon of granulated sugar or demerara sugar.
Bake and slice. Bake the biscotti for about 20 to 25 minutes, or until firm and golden. Remove biscotti from the oven and reduce the heat to 135°C (275°F). Set aside the biscotti to cool for 10 minutes. Cut the logs diagonally into 2cm (3⁄4-inch) slices using a sharp knife. Place the pieces on their sides on the parchment-covered baking tray.
Bake again. Bake the biscotti for another 15 to 20 minutes, or until dry and crisp, turning halfway through the baking time. Allow to cool fully. Once cooled, there will still be a little give in the biscotti. If you want very dry, hard biscotti, add another 10 or so minutes to the bake time.
Make the lemon glaze and decorate biscotti: Add powdered icing sugar to a bowl and add lemon juice. Whisk until combined and lump-free. Either use a spoon to drizzle the glaze over the biscotti. Or, for more accuracy, pour the lemon glaze into a small ziplock bag. Cut a small hole in the corner and drizzle in a zig-zag fashion over the biscotti. Leave to set for 30 minutes, or until the glaze is hard.