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There are two types of storages. The physical storage (memory of iPad itself) and the iCloud storage.
The photos you capture on iPad's camera are stored on physical memory storage which can't be expanded or upgraded. It only have what your iPad comes with (like 16G, 32GB, 64GB etc). You bought iCloud storage and that is of no use unless you have many Apple devices that you backup to iCloud. The photos you taken are not directly stored on iCloud, but they are stored on iPad first and then a backup is made on iCloud.
To free storage, you have to delete photos, videos, movies etc that you no longer need from iPad. Deleting unwanted videos from Camera roll will free more space. Deleting movies or TV shows downloaded from iTunes Store will also free much space.
Go to Settings> General > Storage and iCloud Usage and you will see the details of available storage there. Tap Manage Storage under device storage and you will see what is taking more space. For eg: If Messages is taking more space, you have to open Messages and delete all old messages with attachments like pictures, videos etc
If you have any unwanted games or apps on your iPad, delete them as well.
If you have any questions or would like any additional information, please don't hesitate to ask