iOS manages space well. Computers usually need about 10% free, but I went right up to the limit on my iPhone, and didn't become unstable. Albeit, it was a little limited when I couldn't use any more storage space...
If you are interested in installing your iOS upgrades over-the-air (as opposed to using iTunes to manage them for you), then you'll probably need to leave at least 1GB free (actually, slightly more) in order to accommodate the file download.