Wiktionary
vb. (present participle of take the piss English)
Wikipedia
Taking the piss is a Commonwealth term meaning to take liberties at the expense of others, or to be unreasonable. It is often used to mean (or confused with) taking the piss out of, which is an expression meaning to mock, tease, ridicule, or scoff. It is also not to be confused with "taking a piss", which refers to the act of urinating. Taking the Mickey (Mickey Bliss, Cockney rhyming slang) or taking the Michael is another term for making fun of someone. These terms are most widely used in the United Kingdom, Ireland, South Africa, New Zealand and Australia.
Usage examples of "taking the piss".
I wouldn't try taking the piss out of her - she'd eat me alive, pardon the phrase.
Connor was about to tell him it was no time for taking the piss, when he noticed the buzzing sound and the smell of burning.
Whoever is at the bottom of this is taking the piss, said Hovis, applying himself to his cornflakes.
Tam had already made the further leap of deducing that the sloth-like fuzzball's occasional deeply obvious comments were a caustic means of taking the piss out of anyone who thought he was slow-witted, a misconception he had probably endured for years.