Siddle, 38, fractured a finger while attempting to take a catch off his bowling during Somerset’s T20 Blast defeat to Hampshire last month and the injury will not heal before the end of his contract later this month.
Siddle will return to Victoria from Tasmania in the Australian summer in a player-coach role but said: “My playing days are slowly dying down.”
He told the Somerset website: “Although I still want to play a bit, I’m aware that’s slowly coming to an end. I’ll move into doing a bit of coaching, but whether or not I want to do that in the long term, I don’t know.
“I think my days of signing long deals over the summer are behind me, but if I come back to England and play, it will be as a replacement to cover someone for a short stint. Who knows?
“If Somerset sign Matt Henry again next year and he ends up missing a month during his stint then maybe I might be able to dust off my boots and pull a kit back on. You never say never. I may have a game or two left in me for the club, but as things stand, I’m pretty sure my county cricket days are done.”
Siddle has spent two seasons with Somerset, taking 43 County Championship wickets as well as 24 in the Blast. “I’ve really enjoyed being a part of the club and I’m definitely going to miss it,” he said.