The 29-year-old is yet to be capped by the Wallabies and is returning to his homeland to further his chances of an international call-up.
He made 89 appearances in three seasons at Bath, having won the Super 15 title with the Reds in 2011.
"This has been an incredibly difficult decision for me - I have loved every minute of playing for Bath," he said.
"Getting the opportunity to represent my country has always been an ambition of mine, and getting the chance to realise that is the only reason that I would even consider leaving Bath."
The Somerset side are still looking for a new head coach after parting company with Mike Ford earlier this month.
Number eight Leroy Houston will leave Bath this summer to rejoin Australian Super Rugby side Queensland Reds.