The phrase "taking the piss" is common in casual European-English.
To "take the piss out of somebody" is to lampoon or mock them.
It is an expression that is not common in the U.S. A good translation may be "pull [somebody's] leg."
"Taking the piss" is also used more broadly to indicate a general disrespect or irreverence expressed in action "pulling a fast one." Going for a long lunch break on company time is "taking the piss."
The term can be disruptive or confusing in a trans-Atlantic discussion.