The couple was photographed strolling hand-in-hand in Sydney's Northern Beaches area after enjoying a morning coffee, reported Daily Mirror.
Dannii, 42, is back in the studio working on new music and is also rumoured to be joining the X Factor as a judge.
"Dannii is still very popular in the UK and many people at ITV feel the return of Sharon Osbourne this year was positive and would like to do the same with Dannii.
"The show was most successful a number of years ago so they need some of that success and spark, perhaps mixed with one or two new faces from the music industry today."
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