Coun Reynolds has been a Labour activist for ten years, five as a member of the Labour led Lancaster City Council.
He was narrowly elected to the city council in 2016, and then re-elected in 2019 with a much larger majority.
He said he would continue to serve residents in his council ward of Carnforth and Millhead as an independent councillor.
Coun Reynolds said: "My time in Cabinet and with Labour has been more of a positive experience than I could ever have imagined.
"But, after ten years of activism for Labour, five years in council and two years as a cabinet member, I feel like it is now the right time for me to step back.
"I'd like to apologise to Labour members if you feel I have let you down, but I have to do what feels right for me and my family.
"It was a very difficult, personal decision, and one I didn’t make in haste, or without consultation.
"I’m stepping back to give myself some time out with family and friends, and to concentrate on our community led recovery from coronavirus.”
Coun Reynolds made the announcement via his Facebook page, and said he was overwhelmed by the over one hundred messages, comments, text messages and phone calls he received.
"I genuinely didn’t realise the level of personal support I had in the local community here in Carnforth and across the district," he said.
Coun Reynolds is also a a Carnforth Town councillor, and said: “I hope to make more of a contribution to the town council than I have in the last year.
"Time pressures and the pandemic, have meant my focus has been on city council work, this decision will help me to level up my commitments.”
Commenting on his future relationship with the Lancaster Labour Group, he said: “I consider council leader Erica Lewis and many others in the Labour Group to be friends as much as council colleagues.
"We enjoy a very good working relationship, and I see no reason why that won’t continue to be the case.
"I will continue to support the transformative agenda I helped craft as a member of the Labour Group.
Coun Lewis can rely on my personal support, as she has done in the past.
"I have always sought the broadest possible contributions in my work across council, often crossing party lines to get the best possible deal for all residents.
"No one has a monopoly on good ideas.”
He said: “I know, perhaps more than anyone due to my experience in the finance and planning cabinet roles, the work our community needs to do to recover from coronavirus. We are going to need to take calculated risks, develop significant, forward thinking plans for housing and industrial growth to create jobs, and we must make an honest appraisal of inequality across the district.
"And as if that isn’t enough, we must address a structural deficit in the councils funding to maintain our local services - much to do."
He added: “I’ve lived here my entire life, my whole family is here and my children are growing up here. I’m far too invested to allow this to be the end of the story for me, it’s just the beginning of a different one.”