Buying extra iCloud storage has given you extra space for your backups, to be able to download and install the iOS update you need space available on your actual iPad - space in the cloud and on your iPad are two different things. Your current available space on your iPad is shown in Settings > General > About > Available, and how much space each app is taking up is shown in Settings > General > Usage. You will need to delete items from your iPad to be able to update directly on it, or if you update via your computer's iTunes it should require less free space.
If you connect your iPad to your computer's iTunes you can use the File > Devices > Transfer Purchases to copy your iTunes downloads over to your computer's iTunes library (which you should do whichever way you update) - after you've checked that they've copied over you could then delete iTunes bought films, TV shows and/or music from your iPad so as to free up space on it. Also copy photos off the iPad (photos to computer), and preferably copy any important documents/files off it. And take a backup : File > Devices > Back Up
What 'button to press' doesn't work ?