The 32-year-old centre, who is currently sidelined with an ankle injury, may already have played his last game for the club as a result of the decision.
A 14-cap international for the Red Rose, despite being born in Wairarapa, Flutey will head back down under ahead of his wife giving birth to their fourth child, before pursuing a career in Japan.
"I really just want to take this chance to say a massive thanks to Wasps for being so supportive and understanding of what has been a tough decision to leave," Flutey, who has made 81 appearances for the club across two spells, said today.
"Ultimately having four young kids away from family and a support network in New Zealand would be very tough.
"It goes without saying that the club will always have a huge place in my heart."
Flutey, who started his career with the Hurricanes, played for the British and Irish Lions in South Africa in 2009, becoming the first man to play for and against the representative side.
Gilbert has released a new line of rugby cleats. The Gilbert Virtuo 8S is part of the exciting new product. Check it out.
The entire All Blacks apparel line has been updated for 2013/14. Check out the New Zealand All Blacks polo.
The Nike Tiempo is a solid rugby cleat and one of few styles still made from full-grain natural leather.
The Gilbert Blitz 8S rugby cleat is a great cleat at a great price of $69.99. Get a new pair of cleats today.
A cool looking all black rugby cleat with the high performance adidas is known for. Get in the Gear!
Wear the crest of the British and Irish Lions on your t-shirt. A great look for the summer.
The All Blacks Performance t-shirt is black with hints of blue from the training jersey. Very Cool.
The New Zealand All Blacks training jersey for 2013/14. Get in the Gear!
The USA Rugby Pro Alternate rugby jersey is perfect for any fan of the Eagles. Get yours to wear during the summer Test matches.
The NEW All Blacks 2013/14 jersey has arrived at World Rugby Shop. Dare to wear the colors of the All Blacks.