My iPhone storage is full but my iCloud storage has more then 1 tb free

You'll need to delete pictures, videos, apps, and data to free space. You may also wish to optimize iCloud photos (Settings > Photos) to free up some space on your device.

Another thing that might clear space is to back up to a computer, restore from factory settings, then restore from the backup. It's drastic, but there are often lots of files that just balloon and don't seem to be cleaned up by iOS even if they're not necessary. iOS seems to use more storage that does nothing when you've got a device with more internal storage. They're not saved to the backup and when restored, the backup obviously won't have them.

I've seen several GB freed up this way. Sometimes it's the only way I've been able to install the latest iOS update when I didn't have enough free space.

Set up and use iCloud Photos - Apple Support