Taylor, 26, struggled to make an impact at Griffin Park having moved to the capital from Carlisle last summer.
He ended last season on loan at Burton Albion, but has rejected a return to the Brewers in favour of a one-year contract north of the border.
Taylor arrived at Glanford Park on loan from the Premier League side Bolton Wanderers in January 2004, and impressed then manager Brian Laws enough to be offered a permanent contract before the end of the season.
He spent three-and-a-half seasons with the Iron, helping the side finish second in League Two in 2005 and win the League One title in 2007.
He made a total of 195 appearances for the Iron, scoring 15 goals, including his initial loan spell.