Phoenix general manager David Dome estimated the 35-year-old had spent a total of "three months alone in a hotel room" because of Covid-19 restrictions.
Taylor, who captained the New Zealand club, will return to England.
"Family is more important than football," he said.
"The thought of having to relocate and hub again... I got caught in a lockdown at the end of last season and then again one day after I got out of managed isolation," explained Taylor.
"It feels like it's followed me everywhere. I haven't had any type of a normal life for some time.
"I'm excited for the next chapter and to see my family back home in the UK."
The Wellington side have been based in Australia for much of the last two seasons because of travel difficulties during the pandemic and Dome emphasised how difficult the relocation had been.
"Covid has been tough on this club, its players and staff over the past two years and especially for Steven," he said.
"[He's had] six stints in quarantine - that's three months alone in a hotel room - over the past two-odd years. That kind of thing takes a toll on a person."
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